By Gina Lee
Investing.com – Asia Pacific stocks were mostly up Wednesday morning, with investors brushing off a higher-than-expected rise in U.S. inflation to focus on the global economic recovery from COVID-19.
China’s Shanghai Composite inched up 0.01% by 11:12 PM ET (3:12 AM GMT) and the Shenzhen Component jumped 1.36%. Wednesday’s March trade data, including exports, imports and the trade balance, continued to give Chinese shares a boost. Further data, including GDP, industrial production and fixed asset investment, is due on Friday.
Credit markets are monitoring a sharp selloff in China Huarong Asset Management Co. Ltd. (HK:2799), one of the country’s largest distressed debt managers. The selloff triggered concerns that other heavily leveraged borrowers could also stumble.
Hong Kong’s Hang Seng Index rose 0.96%.
Japan’s Nikkei 225 was down 0.45%, amid concerns a slower-than-expected COVID-19 vaccine rollout will limit activity. Data on Japanese core machinery orders, released earlier in the day, also disappointed. February’s core machinery orders contracted 7.1% year–on–year, against the 2.3% growth in forecasts prepared by Investing.com and January’s 1.5% growth. Orders contracted 8.5% month-on-month.
South Korea’s KOSPI inched up 0.01% and in Australia, the ASX 200 rose 0.32%.
In the U.S., data released on Tuesday said that the core consumer price index (CPI) rose 0.3% month-on-month in March, against the 0.2% growth in forecasts and February’s 0.1% growth. The CPI grew 0.6% month-on-month.
The higher-than-expected numbers seemed to have little impact, however, given that the distortions surrounding the slump in price pressures in 2020. Some investors also remained confident that recovery will continue as central banks and government spending continue to provide support.
“A lot of growth and inflation has already been priced into the market... it’s almost as if you need to exceed those expectations in order to see a more pronounced reaction from markets,” John Hancock Investment Management co-chief investment strategist Emily Roland told Bloomberg.
Investors also continue to monitor U.S. Treasury yields, which extended gains following a successful auction of 30-year bonds as fears that poor demand could spark another bout of volatility were assuaged.
However, runaway inflation, along with higher borrowing costs and taxes, replaced COVID-19 as the top concern for global fund managers, according to the latest Bank of America Corp (NYSE:BAC). survey.
U.S. Federal Reserve Chairman Jerome Powell will speak at an Economic Club of Washington event later in the day when the central bank will also release its Beige Book.
Meanwhile, in a blow to the global COVID-19 vaccine rollout, the U.S. Centers for Disease Control and Prevention and FDA halted the use of the Johnson & Johnson (NYSE:JNJ) vaccine on Tuesday. The pause comes after six women who received it developed a rare and severe form of blood clotting and is expected to last for a few days.
In cryptocurrencies, bitcoin reached a record high and the Nasdaq set a reference price of $250 for the direct listing of cryptocurrency exchange Coinbase Global Inc. that starts trading later in the day.